Why the branch appointment no longer decides things
High street banking in Britain has changed shape. Branches in towns like Shrewsbury, Darlington and Ayr have thinned out, and a face-to-face appointment can sit weeks away. For a sole trader in Glasgow who needs a sort code before a client pays an invoice, that wait is a real cost. So most new businesses now open an online business bank account first and treat the traditional bank as a later relationship.
The structure question trips up more people than anything else. A sole trader, a limited company, a partnership and an LLP each face a different door. Mettle, for instance, only takes limited companies with no more than two owners, all UK tax residents, and just one director with account access. Monzo Business doesn't accept partnerships or community interest companies. Revolut Business is limited companies only. Appl forms get refused for reasons that have nothing to do with credit history.
Then there's cash. Plenty of UK businesses still handle it: market traders in Leeds, cafés in Bristol, mobile repair vans in Belfast. Digital-only accounts vary widely here. Starling charges 0.7% with a £3 minimum when you deposit cash at a Post Office. Others cap free deposits monthly and charge above that. Ignore this line on the pricing page at your peril.
And tax reporting has moved. Making Tax Digital for Income Tax now applies to larger sole traders, with the £30,000 threshold arriving in April 2027. If your bookkeeping lives in a separate app from your banking, quarterly updates become a monthly headache. Accounting integrations stopped being a nice extra some time ago.
What the comparison actually looks like
Most providers now split into two camps: banks with a licence and e-money firms with safeguarding arrangements. Both can run your business, but the protection works differently. Deposits at a licensed UK bank fall under the Financial Services Compensation Scheme, up to £120,000 per eligible depositor per bank. E-money firms hold your money in safeguarded accounts instead, which is not the same thing. Tide, for example, isn't a bank itself; customer money sits with ClearBank, which is FSCS-protected. It's worth asking the question directly rather than assuming.
| Provider | Best suited to | Monthly cost | Main drawback |
|---|
| Starling | Sole traders and limited companies wanting zero fees | No monthly fee | Cash deposits cost 0.7%, £3 minimum |
| Tide | Fast onboarding, built-in invoicing | Free plan; paid tiers from around £10 | 20p per transfer on the free plan, £1 ATM fee |
| Mettle | Small limited companies wanting FreeAgent included | No monthly fee | Strict eligibility, one director with access |
| Monzo Business | Mobile-first founders | Lite free; Pro £9 | No partnerships or charities, integrations only on Pro |
| Zempler | Founders who've been declined elsewhere | Free tier; paid options at £9 and £19 | Fewer add-on tools than rivals |
| Wise Business | Businesses paying overseas suppliers | Essential free; £50 one-off for the higher tier | Not a bank, so safeguarding rather than FSCS |
One Cardiff sole trader running a two-person design studio started on a free tier and moved after six months. The trigger wasn't the fee itself; it was twenty-odd transfers in a busy month turning into small charges she had to reconcile by hand. Switching to a no-fee account saved her maybe £8 a month, but the cleaner statements saved more in accountant time.
Opening one without wasting a fortnight
Decide your legal structure before you shop. It narrows the list faster than any comparison site.
Gather the paperwork in one go: photo ID, proof of UK address for each director, your Companies House number if you're incorporated, and a plain description of what the business does. Vague answers such as "consulting" slow applications down; "freelance structural engineering" doesn't.
Test the app before committing. Nearly every provider lets you download and explore before you apply, and the onboarding flow tells you more about day-to-day usability than a features list will.
Check three practical things: how you'll pay in cash, whether you need multi-currency, and whether your accountant's software connects. A Yorkshire retailer taking £200 in notes on a Saturday needs a different account to a Manchester agency invoicing in euros.
If you're moving from an existing account, the Current Account Switch Service handles Direct Debits, standing orders and incoming payments, and the guarantee covers you if something goes wrong. Most switches complete within seven working days.
Keep one backup account open for the first few months. Payment rails fail occasionally, and a second sort code costs nothing if it sits dormant.
Free support exists, too. Growth Hubs across England, Business Gateway in Scotland, Business Wales and Invest NI all run sessions on banking and bookkeeping basics, usually at no charge.
The account you open in your first week probably won't be the one you keep at year three. That's normal. Pick something that lets you get paid, keeps your records clean, and doesn't punish you for a busy month. Then revisit it once the business has a shape.
Start with the eligibility page rather than the pricing page. Five minutes there will tell you more than an hour of comparison.
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